Hong Kong’s Urban Renewal Authority makes record offer for buildings in Sai Ying Pun
Authority will pay HK$24,000 per square foot, but economist says property prices will be even higher after redevelopment
The Urban Renewal Authority (URA) has offered a record HK$24,000 per square foot to buy properties for a redevelopment project in Sai Ying Pun.
The acquisition offer, announced on Monday, came as private home prices in the world’s least affordable property market continued to rise for two straight years as of the end of March.
Economist Andy Kwan Cheuk-chiu said after the redevelopment, the properties would be valued at more than HK$30,000 per square foot.
The project, between Sung Hing Lane and Kwai Heung Street, will see 101 property owners benefit from the offer. They will have two months to accept. The offer, at HK$23,568 per square foot, means the authority will pay almost HK$12 million for a 500 sq ft flat. The URA said the offer was set by seven independent consultancy firms based on the price of flats in seven-year-old buildings in the same area. In November, developer New World’s Artisan House in the same area was asking HK$10 million for a 221 sq ft flat.
It’s a lose-lose situation ... The URA will definitely lose whatever the scenario
The project was authorised by the government in March and covers a total area of about 12,000 sq ft, involving 14 buildings.
The URA plans to redevelop the area into 89,000 sq ft of homes and 4,000 sq ft of commercial space. The project is expected to be completed by 2026 or 2027.